Closing the Wealth Gap Requires Collaborative Efforts

by Kenneth Mallory on July 30, 2013

Wealth Gap Roundtable MMTC Conference - Jason Miccolo JohnsonA systemic and persistent racial wealth gap plagues the nation.  The statistics surrounding the gap, as discussed during a recent “Wealth Gap Roundtable” at MMTC’s 11th Annual Access to Capital and Telecom Policy Conference, were chilling, even as experts proposed possible solutions.

“It’s stark when you have white families holding wealth on average twenty times what the average black family has … 18 times the average Hispanic family, ” remarked Hon. Marie C. Johns, Former Deputy Administrator of the Small Business Administration.

“Where the average net worth for an African-American family is somewhere in the neighborhood of $6,000,” said Jane Campbell, Majority Staff Director for the U.S. Senate Small Business and Entrepreneurship Committee, “… for a white family” it “is somewhere north of about $110,000.”

Dr. Nicol Turner-Lee, President of the National Association of Multi-ethnicity in Communications, moderated as panelists discussed the issue and ways to resolve it. As the recession has caused widespread unemployment, it has impacted African Americans and Hispanics to a much greater degree than whites. Several organizations, such as the Pew Research Center, have studied and analyzed the ‘wealth gap’ issue.  While the exact causes of the wealth gap still seem to elude some, others cite the lack of education and the dearth of job opportunities as possible reasons.

Maureen Lewis, Director of Minority Telecommunications Development for the National Telecommunications and Information Administration, acknowledged that the wealth gap was a “complex issue” with “a lot of interrelated causes,” but noted that in her opinion, there is a “persistent opportunity gap in many minority communities.”

Lewis stated that higher education improves employment opportunities, “good employment provides investment opportunities, and investment funds innovation.”

The panelists’ comments underscored the idea that providing greater economic opportunities to minority communities could help narrow the gap.

According to Johns, a changing economy and demographics in the United States – where minority populations are growing – requires “changing strategies” to address wealth disparities.  Johns, along with Campbell, noted that the U.S. Small Business Administration provides opportunities to increase access to capital for budding entrepreneurs.

Campbell stated that U.S. Senator Mary Landrieu (D-LA), Chair of the U.S. Senate Small Business and Entrepreneurship Committee, “truly believes that one of the ways to address the wealth gap is to encourage nontraditional populations to start their own business and grow that business, because it is through business ownership that you have an opportunity to build wealth, to pass it to your next generation and to really expand that opportunity.”

The panelists also discussed the promise of technology and partnerships with the business sector in helping to close the wealth gap and provide greater economic opportunities.

Kelvin Boston, Host and Executive Producer of PBS-TV’s Moneywise Show, for example, said that people of color are “losing out on a great opportunity.”

While minority groups own smartphones and tablets, Boston said opportunities exist to earn revenue from technology through opportunities like employment, investing, and creating software and programs.

Lewis also discussed the Obama Administration’s $7 billion initiative to invest in broadband infrastructure, deployment, and adoption programs through the Recovery Act.

Jim Winston, Executive Director and General Counsel of the National Association of Black Owned Broadcasters, stated that engagement of the business sector is crucial to addressing the wealth gap issue.  “If you’re going to create wealth, you have to have involvement in the business sector,” he said.  “Organizations that are committed to addressing entrepreneurship are critical to closing the wealth gap.”

  • Kenneth Mallory is an award-winning journalist and attorney who has freelanced for several publications, in addition to serving as a general assignment reporter for the Washington Afro-American Newspaper. He earned his B.A. magna cum laude from University of Maryland, Baltimore County, in addition to his J.D. from Northwestern University School of Law.

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